Financial advisors must engage more purposefully with women clients

Many articles and columns ask women to engage with financial advisors to get structured financial advice. But most women find it very difficult to do so. Women often tell me that advisors give canned advice and do not understand their money mindset or are not willing to work with it.

Take the case of Shanti. She manages the family finances along with her husband. Initially, when she would call the financial advisor for any query, he would answer back saying that he has already explained everything to her husband.

Advisor bias

During meetings, the advisor would only address her husband and Shanti felt that the advisor would answer her questions condescendingly, clearly displaying a “what do you know/do you even understand anything” attitude. Incidentally, Shanti does all the groundwork and monitors investments as her husband travels on work extensively.  The search for another advisor turned out to be frustrating and insulting, with most advisors wanting to speak to her husband.

I am shocked to hear that even in the 21st century, these gender biases are still deep-rooted, even in urban areas. Perhaps, it is another reason why women shy away from money management.

Financial advisors need to realize that women do not want to be talked down to.  Neither do they want “women oriented” advice. I remember a bank approaching me for a woman’s account and apart from the basic account, it was giving some shopping vouchers and discounts at stores. No doubt this “woman’s account” would have been the brilliant idea of a male bank employee!

Having women advisors for women clients is also not always a solution. A bank sent Shanti a 27-year-old female advisor, who had barely three years of experience and couldn’t relate to a 40-year-old woman’s requirements. Beyond peddling the bank’s recommended investments, she could provide no additional value or even the right knowledge.

Engaging financially with women

Women like to engage with advisors who will listen to them and not push down advice.  Women do not want to feel stupid just because they ask basic questions. Advisors need to understand that women like to learn and then invest and they need to have the patience and willingness to walk with women on their financial journey.

Of course, using simple terms and being open and honest, especially about fees, are equally important. There is no doubt that educating clients should be the prime feature of the engagement. A combination of education and right advice is a sure-shot way of building trust and a long-term professional relationship with women clients.

While advising couples, financial advisors should understand that a woman may have different goals or even for the same goal, the approach to the target may be different.  I came across a couple, where the husband wanted to buy a new house by using the funds in the employee provident fund account and the wife did not want to do so as she felt that these funds were for their long-term security. The husband’s argument was that they were building an asset, but the wife’s belief was that this meant having less liquid funds available at retirement.  In such situations, the advisor needs to be able maintain a balance and show how both approaches would work out.

One of the things that women financial advisors can do is to form communities with women investors. I run one such community and find that women find this a quick and easy way to have their queries clarified and have someone to talk to, without anyone judging them.

Listening is an art that requires attention over talent, spirit over ego, others over self. The next time you meet a woman client, remember this!

Original Source:

Photo Credit: Moneycontrol

Source: Article written by Mrin Agarwal in Money Control

Originally published on: 03 March 2020

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